BOFIT Viikkokatsaus / BOFIT Weekly Review 2019/13

Apart from the Siberia and Far East federal districts, manufacturing output has risen over the past 3−4 years continuously in Russia’s other six federal districts. Rapid growth in the Central Federal District reflects diverse manufacturing operations in the Moscow region surrounding the City of Moscow, the region enjoying manufacturing growth surpassing 10 % p.a. for the past three years. The mega concentration of the City and the region accounted for over 15 % of all national manufacturing output (excluding oil refining). Manufacturing in the Northwest, Volga and Ural federal districts has also shown good growth.

Fixed investments recovered rapidly over the past two years in the Central Federal District, buoyed by investments in a number of sectors based in Moscow and the Moscow region. In the Northwest Federal District, investments also rose briskly over the past couple of years, due in large part to sharp increases in transportation sector investments in the Leningrad region surrounding St. Petersburg. Investments in the Central and Northwest federal districts last year exceeded the pre-plummet 2014 level by roughly 10 %. Both federal districts continued to raise their shares of fixed investments in Russia over the past two years. In 2018, they together accounted for nearly 40 % of all fixed investments in Russia.

Since the deep slump in 2015, retail sales have recovered to their previous level in only a few of Russia’s more than 80 administrative regions. The Moscow region led the rise, due in part to shifts where retail trade has been moving to the region from the City of Moscow. The Moscow region continues to account for an increasing share of national retail sales, which, together with the City, was nearly 23 % of the country’s retail sales in 2018. Retail sales in the City of St. Petersburg and the Leningrad region have recovered to 2014 levels. In five federal districts, however, retail sales last year were still at levels 10−15 % below those of 2014.

Real change in manufacturing, investments and retail sales in 4 federal districts and the 2 largest urban centres, 2015−2018Source: Rosstat.

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